Thursday, May 01, 2008

Oh this is such fun

One can have a lot of fun at the expense of our political establishment. Sadly, at the end of it all, they have the last laugh. Here is a wonderful piece of news: Alistair Darling is setting up a working group or a think tank as one of London's freebie papers called it, to have a look at the British tax system that is driving multinationals away from this country.

Well, no, since you ask, it is not the fact that Britain has stayed out of the European and Monetary Union, popularly known as the euro, that is causing the problems. Some of these companies are, indeed, going to Ireland, but they do not mention the euro. What they do mention is the impossibly high taxes they have to pay in this country.

The CBI, instead of telling Alistair Darling a few home truths, is supporting the idea.

CBI director general, Richard Lambert said: ‘The CBI looks forward to working as part of the new group to identify a clear, internationally competitive corporate tax strategy for the UK.’

The employers’ body released a taskforce report last month revealing failure of the UK tax system to respond to increasingly global business activity which was creating an unsustainable regime.

Hmm. So, how much research will this working group or think tank have to do? How many staff will it have and how many position papers will it produce? How much will it cost the taxpayer? And all the time, the answer is so simple. In fact, it can be boiled down to two words. But one cannot quite envisage the government listening. Of course, this might be a ploy to drag matters out until the next President of the European Union, France, goes all out to harmonize those corporate tax rates.